Arkia Israeli Airlines (IZ, Tel Aviv Ben Gurion), its workers’ committee, and Israel’s powerful national trade union Histadrut have agreed to cut almost 25% of the workforce, the country’s Hebrew-language International Air Services news site reported.

According to the deal signed late at night on September 16, Arkia will dismiss 130 of its 530 staff, while the employees who remain who are earning more than ILS8,000 shekels (USD2,336) per month will take a pay cut. Anyone earning up to that amount will see no change. Laid-off employees will be released “gradually,” the agreement stipulates.

The carrier’s fleet - two A321-200NX(LR)s, one ERJ 190-100LR, one ERJ 190-200AR, and two ERJ 190-200LRs, according to the ch-aviation fleets advanced module - was grounded at the start of the pandemic and all employees were put on unpaid leave.

With the redundancy agreement, its management has decided to gradually resume flights, likely targetting its historically popular route between Tel Aviv Ben Gurion and Eilat Ramon and afterwards, international flights.

Before the closure of Tel Aviv Sde Dov Airport in July 2019, Arkia had a 70% market share on the domestic Eilat route, but since the country's lockdown was eased Israir (6H, Tel Aviv Ben Gurion) jumped in to take up the slack while Arkia and its workers fell into a protracted spat over pay.

The Nakash brothers - Joseph, Raphael, and Abraham who own 70% of the airline’s capital - signed what was described as an “agreement to rehabilitate the company” in the presence via Zoom of Histadrut chairman Arnon Bar-David.

“There is no better news for Rosh Hashanah [Jewish New Year] than opening a workplace that has been silent for six months. We performed CPR on Arkia and returned it to the world of aviation. I am proud of Arkia’s committees, which knew how to make difficult decisions, and of Arkia’s employees who conducted a clean and inspiring protest,” Bar-David said.

The chairman of the Arkia workers’ committee, Aliza Blaish, commented that the deal was “a significant step to save the company from closing and firing hundreds of workers.” Gadi Tepper, Arkia’s chairman of the board, added: “After intensive negotiations that lasted for days and nights, we signed a new collective agreement that will march the company back to activity and open new destinations.”